This web log is a news and views blog. The primary aim is to provide an avenue for the expression and collection of ideas on sustainable, fair, and just, grassroot level development. Some of the topics that the blog will specifically address are: poverty reduction, rural development, educational issues, social empowerment, post-Tsunami relief and reconstruction, livelihood development, environmental conservation and bio-diversity.

Embezzlement of tsunami funds by European NGOs: EU official assures thorough probe

A top EU official Friday assured President Mahinda Rajapakse of a thorough investigation on alleged embezzlement of tsunami reconstruction funds by NGOs based in EU territory.

Niranjan De Silva Deva-Aditya, the majority leader of the Overseas Development Committee of the EU met Rajapakse at Temple Trees where he discussed a front-page report headlined Rehab. Chief slams NGOs over embezzlement of tsunami funds on the previous day’s issue.

"I am appalled," he told The Island , expressing the belief that the government would provide him with the required information. President Rajapakse promised to facilitate the inquiry, he said, adding that he was in touch with relevant authorities.

The British member of EU Parliament said that he held several meetings with NGOs and Ambassadors of countries involved with tsunami relief, reconstruction and development efforts. "I was told that everything was fine," he said. But the recent statements attributed to RADA Chief Ms. Shanthi Fernando and the Central Bank caused apprehension, he said.

Depending on the information provided by the government, Deva-Aditya intends to have a public hearing in the EU parliament.

According to him the EU released USD 450 million to Sri Lanka and Indonesia after the tsunami and the international community sent USD 4.2 billion to the affected countries. Fielding questions, he said that during Friday’s meeting he discussed the peace process, the humanitarian crisis triggered by the latest bout of fighting and his decision to contest the Post of UN Secretary General.

RADA Chief Ms. Shanthi Fernando last week accused both local and international NGOs of large scale embezzlement of tsunami reconstruction and development funds.

Detailing shortcomings in the reconstruction strategy, Ms Fernando focused on the alleged irregularities involving the NGOs, recipient of considerable amount of funds.

According to the Bank Supervision Department of the Central Bank 256 NGOs had received donations and other funds amounting to Rs. 40.1 bn by way of credits to their bank accounts from various foreign and local sources during 2005.

A survey revealed that 73% of total foreign remittances were received by 30 NGOs, each receiving foreign remittances in the range of 1% to 12% of total foreign remittances.

Further, it was revealed that nearly 79% of funds received in the bank accounts of all NGOs during 2005 had been withdrawn. The 30 NGOs referred to above had withdrawn 85% of funds received in their bank accounts during the year 2005.

Against this background Parliament appointed a Select Committee to probe NGOs. The investigation is headed by JVP MP Vijitha Herath.

Initially 23 International NGOs pledged to construct 66,811 houses, Ms. Fernando said, claiming that finally they entered into agreements with the government to build 16,487 houses. By end of last year they completed only 1,232 houses, she said, accusing a certain NGO of making a grandiose plan to construct 26,000 houses. But this particular NGO completed only 264 houses by end of last year, she said. "We would like to know what happened to the funds collected by them," she said, emphasising the government’s right to know.

The RADA chief acknowledged that only 38 percent of the total number of houses needed by the tsunami homeless had been completed. According to her by the first week of August the government reached agreements with various NGOs for the construction of 29,971 houses. She placed the total number of homeless families at 35,363 while adding that of the total requirement 11,551 houses had been completed. According to her 6,946 houses were under construction.